Sheeder v. Boyette

• Decision Date: 19 February 2009
• Docket Number: No. 08-1086.,08-1086.
• Citation: 764 N.W.2d 778
• Parties: Steven C. SHEEDER, Plaintiff-Appellant, v. Bern BOYETTE, Defendant-Appellee.
• Court: Iowa Court of Appeals

764 N.W.2d 778

Steven C. SHEEDER, Plaintiff-Appellant, v. Bern BOYETTE, Defendant-Appellee.

No. 08-1086.

Court of Appeals of Iowa.

February 19, 2009.

David Leitner, West Des Moines, for appellant.

Lyle Ditmars, Council Bluffs, and Richard Wilson, Lenox, for appellee.

Heard by VOGEL, P.J., and VAITHESWARAN and EISENHAUER, JJ.

VOGEL, P.J.

Steve Sheeder, the plaintiff in an action seeking damages for deprivation of farm land, appeals from the district court's ruling setting aside a default judgment. Sheeder asserts that the district court abused its discretion in setting aside the default judgment because the defendant lied to the court as to his reason for not appearing for trial. We agree that "good cause" cannot be based on an untruth. Therefore, we reverse and remand for reinstatement of the original judgment.

I. Background Facts and Proceedings

On July 3, 2006, Sheeder filed an action for deprivation of farmland naming Bern Boyette as the defendant. On September 17, 2006, Boyette was served with notice of the suit. Subsequently, the district court set a scheduling conference, but the conference was reset seven times because both parties failed to appear. On January 19, 2007, Sheeder filed a notice of intent to file an application for default. On March 8, 2007, Boyette filed an answer and counterclaim. On March 12, 2007, the district court scheduled trial for November 6, 2007.

Prior to trial, on August 6, 2007, Boyette's attorney filed a motion to withdraw. Boyette resisted his attorney's motion by submitting a letter to the court. On August 27, 2007, following a hearing, the district court granted Boyette's attorney's motion to withdraw.

On November 6, 2007, the case came on for trial and neither Boyette nor counsel for Boyette appeared. The district court received evidence offered by Sheeder to support the claims alleged in his petition.¹ The district court then entered a default judgment in the amount of $131,257.01 in favor of Sheeder and dismissed with prejudice Boyette's counterclaims.

On November 20, 2007, Boyette moved to have the default judgment set aside. Following a hearing, the district court granted Boyette's motion finding that the default judgment should be set aside on the grounds of excusable neglect. However, should Boyette be successful in any of his counterclaims, he would only be allowed damages to the extent of any damages awarded to Sheeder. On June 10, 2008, following a trial, the district court found that Sheeder was not entitled to notice of termination of the farm tenancy under Iowa Code chapter 562 (2005).² On other claims not at issue in this appeal, the district court entered judgment in favor of each party in the amount of $902.14.

II. Default Judgment

Iowa Rule of Civil Procedure 1.977 provides "[o]n motion and for good cause ... the court may set aside a default or the judgment thereon, for mistake, inadvertence, surprise, excusable neglect or unavoidable casualty." In ruling on a motion to set aside a default judgment, the district court is vested with broad discretion and will only be reversed if that discretion is abused. Brandenburg v. Feterl Mfg. Co., 603 N.W.2d 580, 584 (Iowa 1999). We are bound by the district court's factual findings if supported by substantial evidence. Id. The determination of whether a movant has established good cause is not a factual finding; rather, it is a legal conclusion and is not binding on us. Id.

The burden is on the movant to plead and prove good cause. Id.; Cent. Nat'l Ins. Co. of Omaha v. Ins. Co. of N. Am., 513 N.W.2d 750, 754 (Iowa 1994). Good cause is a "sound, effective, and truthful reason. It is something more than an excuse, a plea, apology, extenuation, or some justification, for the resulting effect." Cent. Nat'l Ins. Co. of Omaha, 513 N.W.2d at 754 (emphasis added); Hansman v. Gute, 215 N.W.2d 339, 342 (Iowa 1974). Rather, the reason for default must rise to one of the grounds enumerated in the rule: mistake, inadvertence, surprise, excusable neglect or unavoidable casualty. Cent. Nat'l Ins. Co. of Omaha, 513 N.W.2d at 754. Additionally, good cause requires at least a claimed defense asserted in good faith. Id.

The underlying purpose of rule 1.977 is "to allow a determination of controversies on their merits rather than on the basis of nonprejudicial inadvertence or mistake." Brandenburg, 603 N.W.2d at 584. However, this objective is qualified because it cannot be extended to the point where a default judgment will be vacated when the movant has ignored the rules of procedure with ample opportunity to abide by them. Haynes v. Ruhoff, 261 Iowa 1279, 1282, 157 N.W.2d 914, 916 (1968). "[W]e have never upheld such a grant where the movant fails to show any effort to appear in response to a due and timely notice." Id.

The issue before us is whether Boyette met his burden to prove "good cause." Boyette moved the district court to set aside the default judgment asserting that he did not have notice of the trial date. A hearing was held, during which Boyette claimed that he had difficulty in receiving his mail and thus did not have notice of the trial date. Skeptical of this claim, the district court noted several notices and orders sent to Boyette by the clerk of court, none of which were returned as undeliverable. The court also discussed a series of correspondence between Boyette and his former counsel, all indicating Boyette was receiving his mail and aware of the progress of the litigation. The district court specifically found that

[Boyette] was advised of the trial date of November 6, 2007 from a copy of the scheduling order sent to him by his attorney, was advised of the need for prompt attention to pre-trial issues in mid summer, and was further reminded at least of the general time frame of his trial in the letter of August 3, 2007.

However, Boyette did little to "obtain other counsel following the withdrawal of his attorney until faced with the entry of judgment against him. His denial of knowledge of the trial date is not credible." In spite of a finding that Boyette's asserted reason for not appearing at trial was false, the district court found that the default judgment should be set aside on the ground of excusable neglect. Upon the parties' motions to amend or enlarge, the district court again concluded "[Boyette] knew of the trial date."

Sheeder asserts that the district court abused its discretion because Boyette lied to the court in an effort to excuse his failure to appear at the scheduled trial. Therefore, Sheeder asserts Boyette did not establish good cause to set aside the default judgment. We agree. Pursuant to rule 1.977, the burden is on Boyette to establish good cause, which requires a "sound, effective, and truthful reason" that rises to one of the grounds enumerated in the rule. Cent. Nat'l Ins. Co. of Omaha, 513 N.W.2d at 754. Because the district court found that Boyette's asserted reason for defaulting was not credible and indeed false, Boyette was unable to plead the prerequisite "truthful reason" and therefore unable to prove any of the grounds enumerated in the rule. Thus, he was unable to prove good cause.

...